10 Resolutions That Will Increase the Value of Your Business
How much is your business worth?
If your goal is to build the value of your business in 2021, here are some New Year’s resolutions to consider:
- Stop chasing revenue. A bigger company is not necessarily a more valuable one if the extra sales come from products and services that are too reliant on you to deliver them.
- Start surveying your customers using the Net Promoter Score It’s a fast and easy way for your customers to give you feedback, and it’s predictive of your company’s growth in the future.
- Sell less stuff to more people. The most valuable companies have a defendable niche selling a few differentiated products and services to many customers. The least valuable businesses sell lots of undifferentiated products and services to a concentrated group of buyers.
- Drop the products or services that depend on you. If you offer something that needs you to produce or sell it, consider dropping it from your offerings. Services and products that require you suck up your time and cash and don’t contribute significantly to your business’s value.
- Collect more money up front. Turn a negative cash flow cycle into a positive one and you will boost your business’s value and lessen your stress load.
- Create more recurring revenue. Predictable sales from subscriptions or recurring contracts mean less stress in the short term and therefore a more valuable business over the long run.
- Be different. Refine your marketing strategy to emphasise the point of differentiation that customers value. Be relentless in highlighting this advantage.
- Find a backup supplier for your most critical raw materials. Consider placing a small order to establish a commercial relationship and diversify the sources of your most-difficult-to-find materials.
- Teach them to fish. Answer every employee question to you with “What would you do if you owned the business?” Your goal should be to cultivate employees who think like owners so they can start answering their own questions without coming to you.
- Create an instruction manual. Document your most important processes so your employees can do their work independently.
As can be seen, you need to think about your business structure and activity to maximise its attractiveness to potential buyers.
Moreover, ActionCOACH Chilterns Central has a long track record of helping business owners increase the value of their business. After an assessment of your situation, we have a range of strategies that you can apply to your business. Ultimately, the aim is to create a business that can run without you.
Why? This enables you to choose what you want to do whether that is to stay involved in your creation or to sell it to realise the capital of your efforts and follow other interests.
Here’s to building a more valuable company in 2021!
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